As you approach adulthood and start to think about your future, are you really ready to be financially responsible for yourself? If you answered no, you’re not alone. The Jump$tart Coalition administered a basic financial literacy test to high school seniors, and less than half of the students correctly answered the questions. Another study found that over 75% of college students believe they are not ready to make smart financial decisions for themselves.

Pretty scary, isn’t it? If you think about it, most of your friends probably don’t know how to balance a checkbook. In fact, very few teens actually have a savings account or know what long-term investing means. Do you?

A 2009 Capital One survey discovered that 50% of teens wished they knew more about personal finances. Whether you have never stepped foot in a bank or you are actively saving and investing for your future, all it takes is a little effort and a lot of patience to become confident in your financial decisions.

A Millionaire’s Best Friend

One awesome thing that you can take advantage of is compound interest. It may sound like an intimidating term, but it really isn’t once you know what it means. Here’s a little secret: compound interest is a millionaire’s best friend. It’s really free money. Seriously. But don’t take our word for it. Just check out this story of Ben and Arthur to understand the power of compound interest.

Ben and Arthur were friends who grew up together. They both knew that they needed to start thinking about the future. At age 19, Ben decided to invest $2,000 every year for eight years. He picked investment funds that averaged a 12% interest rate. Then, at age 26, Ben stopped putting money into his investments. So he put a total of $16,000 into his investment funds.

Now Arthur didn’t start investing until age 27. Just like Ben, he put $2,000 into his investment funds every year until he turned 65. He got the same 12% interest rate as Ben, but he invested 23 more years than Ben did. So Arthur invested a total of $78,000 over 39 years.

When both Ben and Arthur turned 65, they decided to compare their investment accounts. Who do you think had more? Ben, with his total of $16,000 invested over eight years, or Arthur, who invested $78,000 over 39 years?

Believe it or not, Ben came out ahead … $700,000 ahead! Arthur had a total of $1,532,166, while Ben had a total of $2,288,996. How did he do it? Starting early is the key. He put in less money but started eight years earlier. That’s compound interest for you! It turns $16,000 into almost $2.3 million! Since Ben invested earlier, the interest kicked in sooner.

What You Can Do Now

The trick is to start as soon as possible. A survey by Charles Schwab found that 24% of teens believe that since they are young, saving money isn’t important. Looks like we just blew that theory out of the water! That same survey also discovered that only 22% of teens say they know how to invest money to make it grow. Why not change that stat and learn how to become a smart investor with your money? Talk to your parents or teachers about how to open up a long-term investment account so you can become a millionaire, too. And remember, waiting just means you make less money in the end. So get moving!

Really, you don’t have to have a lot of money to understand basic, common courtesy when it comes to finances. This isn’t difficult stuff.

So why do some people refuse to leave a decent tip, and why do other people feel like they must tell everyone in their church group how much they make?

These, dear readers, are financial faux pas—the worst of the worst etiquette mistakes people make with their money.

Don’t find yourself falling prey to one of these dubious mistakes.

1. Tipping poorly.

Dear Ms. Bad Tipper: Nothing says, “Thank you for taking my order, bringing my food, refilling my drinks, and providing good overall service,” like that $1.56 tip you left on your $20 order. Just think: If your server invests that $1.56 tip in a 12% growth stock mutual fund, they’ll have $17.20 in 20 years! How fancy! In all seriousness, here’s a tip about tipping: Unless your server cursed at you and threw grilled eggplant at your wife, tip 15–20%. Is that really too much to ask for someone who helped you put food in your belly?

2. Talking about how much money you make.

Unless you’re calling into Dave’s show to make your debt-free scream, your household income really isn’t relevant information in everyday conversation. Usually, people who freely share this type of personal information are high-earners, so it only comes across as bragging. Every conversation is a new opportunity to share their income: “Hey Jim. What about that storm last night? Thought a tree might fall on my house, but I make 250k a year, so we could’ve handled it. How’s your wife?”

3. Talking about how much you give.

This one is just as bad as talking about how much you make. No doubt that building wealth and finding financial peace is all about giving to others and changing your family tree. But that doesn’t mean you should broadcast the amount you tithe and give to charity like it’s a tattoo on your forearm.

Genuine givers are humble and even secretive when it’s called for. If you’re giving in hopes that one day you’ll have a county bridge named after you and a statue in town square, then you’re giving for the wrong reasons.

4. Bumming off your friends all the time.

Every group of friends has one. The bum. The mooch. The guy who always realizes he’s “forgotten” his cash right when the check arrives.

Don’t be that guy. Here’s the thing: You might save a couple of dollars here and there, but at what cost? Everyone in your group of friends knows what’s up. They aren’t stupid. You’ve been labeled as the “group mooch.” And, before long, you won’t get invited to dinner, and then you’ll become “the guy who invites himself to dinner,” in addition to being the group mooch. Then you’ll become a social pariah and never score another date—all because you weren’t willing to pay for a $3 taco.

5. Making unreasonable offers when negotiating.

One of the quickest ways to end a negotiation is to make a ridiculous offer. It shows the seller that you aren’t serious about buying and you think they’re stupid. You’re saying, “Hey idiot. You obviously have no concept of the cost of physical objects that exist on this Earth. But, tell you what, I’ll humor you and offer you 40% of your asking price. You’re welcome. Dummy.”

How do you know if you’re making an unreasonable offer? Put yourself in their shoes. Would you take $150,000 for a house that’s listed for $275,000? Would you take a quarter for a lamp that’s priced $10 at a garage sale?

6. Putting business over friendships.

Dave says all the time that business partnerships are a bad idea. Why? Because business and friendships rarely mix. There are too many complications and emotions involved. But good friends part ways all the time because someone decided to throw business into the mix.

It’s the guy who thinks his buddy with a nice office job is obligated to make a spot for him. It’s the guy who gets into a multi-level scheme and proceeds to badger all of his friends to “not miss this opportunity!” It’s the athlete who signs his first big contract and feels like all of his childhood friends deserve a cut. A business opportunity may improve, but a friendship will soon end. You can count on that.

These aren’t chalkboard-squeaking, SAT-sweating, pencil-breaking numbers. These are fun numbers. You know the ones that show themselves on bills and bank accounts, the ones that make you wealthy. These are the numbers of the budget.

For 20 years, Dave’s class Financial Peace University (FPU) has taught families how to win with money by laying a solid foundation, which is—you guessed it—a budget! The 10 numbers below prove that even the most free-spirited among us can benefit from a little focus on the numbers each month.

1 – One piece of paper is all you need to make a budget. Forget the fancy spreadsheets and scientific calculators—you just need space to write everything out. Of course, if you’re a nerd and it makes you feel better, go ahead and fire up Excel or print one of Dave’s budget forms to get as detailed as you’d like.

$8,000 – Families who learn to budget in FPU report an average turnaround of $8,000 in the first 90 days. This represents $5,300 reduction in debt and $2,700 saved. Think about where you were at just three months ago. Wouldn’t it feel nice to be $8,000 ahead today?

We’d love to help you get there with Dave’s $8,000 Turnaround Giveaway, celebrating 20 years of life change through FPU. You can enter once a day through September 2!

56% – We talk about budgeting all the time, so it might sound like it’s what all the cool kids are doing. It’s not. In fact, 56% of Americans admit they don’t budget. Many of them don’t even know what they spend each month on housing, food and entertainment. Don’t be like these folks. Be weird!

0 – A zero-based budget is the key to winning with money. Give every dollar a name, on paper, on purpose before the month begins. This means your income minus your expenses should equal zero. Take control of your money by telling it what to do!

15% — Studies show people spend 15% more money when they pay with a card instead of cash. Identify budget categories where you tend to overspend. Then make a cash withdrawal for those areas and place the money in the envelope. When it’s gone, it’s gone!

3 – A kid’s budget is broken into three areas: give, save and spend. Budgeting helps kids understand the value of work and how to use their own money to make purchases and bless others. It also teaches kids to be content—a refreshing quality in today’s youth.

20 billion – The turnaround tracker is at 20 billion andcounting. More than 2.5 million families have taken FPU since it launched in 1994. The tracker is a real-time calculation of the estimated turnaround that occurs each time another family signs up for FPU. While you’ve been reading this, another family likely paid off their car loan and saved $1,000!

18% – Families who use the zero-based budget save 18% more money than people who don’t. This means they’ll build an up emergency fund and pay off debt more quickly simply because they’re applying the wisdom of giving every dollar a name. If you’re smart, you do what works.

4 – The first time you budget, it’s going to hurt. The next month, you’ll still be confused. By the third month, your needs—and the ability to meet those needs— will finally start to make sense. By month four, you’ll feel like an old pro. What once took hours will eventually take just twenty minutes and might—just might—be a little fun.

312 – Dave and Sharon Ramsey filed for bankruptcy in September 1988. As a result, they made big changes to how they handled their money. Dave and Sharon began budgeting immediately and the budgeting continues today. They’ve completed 312 budgets so far. Yes , Dave and Sharon still complete a budget each month—and that means you should too.

Most of us have a love-hate relationship with the grocery store. Some coupon-savvy families squeak by on less than $300 a month, while others jam-pack their carts to the tune of $300 a week.

So who’s right?

It depends. We recommend spending 5–15% of your take-home pay on food, which includes groceries and meals out. But even if your food budget falls within that healthy range, maybe you’d still like to see it come down a few notches. Check out these five easy ways to change your grocery shopping habits for the better—without clipping coupons.

1. Redefine Dinner

If the word dinner conjures up a big homemade meal with a nice cut of meat, two steaming sides, a crusty French loaf and a chocolaty finish, cut yourself some slack! This isn’t the 1950s and weeknight suppers don’t have to be a big production.

Your kids and spouse will survive on BLTs, omelets or a nice salad several times a week. So don’t be afraid to plan simple, one-item-only meals. Reduce your guilt andyour budget by redefining the most expensive meal of the day.

2. Buy the Store Brands Already!

You know generic pasta is cheaper, but you’re still not convinced it won’t ruin your great-grandmother’s lasagna recipe. In a 2009 Consumer Reports study, 29 brand-name foods went up against their generic counterparts. Of the 29 pairings, 19 scored “equally good” in the blind taste test. In other words, your less-expensive lasagna will taste just as delicious.

Still not sold? According to a 2014 academic study, when chefs bought staples like salt, sugar and baking soda, they were much more likely to buy the generic than were non-chefs. And they’re the food experts! The study concluded that if more of us purchased store brands, we could save roughly $44 billion collectively. It pays to be brand un-loyal.

3. Change Up Your Grocery Stores

What made you pick your current grocery store? Is it the friendliest? How about the most convenient? Maybe you just know where everything is? Don’t let a comfortable routine cost you money.You may even find that two grocery stores are your best bet—one for meats and bulk items and another for everything else.

If you’re still not sure which grocery stores are worth checking into, ask around. People love talking about getting a good deal, and the ones who are getting the best deals will gladly gush about their favorite spots. Figuring out a new grocery store may be frustrating at first, but it’s worth learning a new layout to keep that extra $20 in your wallet.

4. Make a Detailed List

A list is simply a plan. You must plan out what you’ll make for breakfasts, lunches and dinners for the next week and then write out each ingredient you’ll need for those meals (plus a few snacks, of course).

When you arrive at the store, remember to buy only what’s on your list. This is key to staying on budget! And if you go shopping as a family, let your kids help plan the meals on the front end so they know this trip isn’t a junk food free-for-all. It’s much easier to stay on budget when you’re shopping with a plan and working as a team.

5. Always Use Cash

The best way to stick to a lower food budget is to pay with cash. When you enter the grocery store with cash in hand, you know exactly how much you can spend. Plus, you’ll stick to the meat-and-potatoes necessities of your budget rather than your ice cream-and-cookie impulse buys.

If you still find you’re eating high on the hog at the beginning of the month and then scraping by on tuna fish by the end, make a cash run every two weeks, instead of every month. This way, you’ll have a better picture of how much you can actually afford to spend each week, versus for the entire month.

Better Habits, Better Budget

By simply starting a few new habits, you can lower your monthly food budget and meet your money goals even faster. That means more cash to pay down debts, invest for the future, or save up for something fun—like a babysitter and a nice meal out where someone else cooks and cleans up.

See why Dave recommendseMeals to help you gain control of your family meal plans and food budget.

Now that the market has showed signs of recovery, some sellers may be tempted to try and sell their home on their own (FSBO) without using the services of a real estate professional.

Real estate agents are trained and experienced in negotiation. In most cases, the seller is not. The seller must realize their ability to negotiate will determine whether they can get the best deal for themselves and their family.

Here is a list of some of the people with whom the seller must be prepared to negotiate if they decide to FSBO:

The buyer who wants the best deal possible

The buyer’s agent who solely represents the best interest of the buyer

The buyer’s attorney (in some parts of the country)

The home inspection companies, which work for the buyer and will almost always find some problems with the house.

The termite company if there are challenges

The buyer’s lender if the structure of the mortgage requires the sellers’ participation

The appraiser if there is a question of value

The title company if there are challenges with certificates of occupancy (CO) or other permits

The town or municipality if you need to get the COs permits mentioned above

The buyer’s buyer in case there are challenges on the house your buyer is selling

Your bank in the case of a short sale

Bottom Line

The percentage of sellers who have hired a real estate agent to sell their home has increased steadily over the last 20 years. Meet with a professional in your local market to see the difference they can make in easing the process.

As the economy continues to improve, more and more Americans are seeing their personal financial situations also improving. Instead of just getting by, many are now beginning to save and find other ways to build their net worth. One way to dramatically increase their family wealth is through the acquisition of real estate.

For example, let’s assume a young couple purchases and closes on a $250,000 home in January. What will that home be worth five years down the road?

Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists every quarter. They ask them to project how residential prices will appreciate over the next five years. According to their latestsurvey, here is how much value that $250,000 house will gain in the coming years.

Over a five year period, that homeowner can build their home equity to over $40,000. And, in many cases, home equity is large portion of a family’s overall net worth.

Bottom Line

If you are looking to better your family’s long-term financial situation, buying your dream home might be a great option.

There are many benefits to homeownership. One of the top ones is being able to protect yourself from rising rents and lock in your housing cost for the life of your mortgage.

Don’t Become Trapped

Jonathan Smoke, Chief Economist at realtor.com recently reported on what he calls a “Rental Affordability Crisis”. He warns that,

“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.”

The Joint Center for Housing Studies at Harvard University recently released their 2015 Report on Rental Housing, in which they reported that 49% of rental households are cost-burdened, meaning they spend more than 30% of their income on housing. These households struggle to save for a rainy day and pay other bills, such as food and healthcare.

It’s Cheaper to Buy Than Rent

In Smoke’s article, he went on to say,

“Housing is central to the health and well-being of our country and our local communities. In addition, this (rental affordability) crisis threatens the future value of owned housing, as the burdensome level of rents will trap more aspiring owners into a vicious financial cycle in which they cannot save and build a solid credit record to eventually buy a home.”

“While more than 85% of markets have burdensome rents today, it’s perplexing that in more than 75% of the counties across the country, it is actually cheaper to buy than rent a home. So why aren’t those unhappy renters choosing to buy?”

Know Your Options

Perhaps, you have already saved enough to buy your first home. HousingWirereportedthat analysts at Nomura believe:

“It’s not that Millennials and other potential homebuyers aren’t qualified in terms of their credit scores or in how much they have saved for their down payment.

It’s that they think they’re not qualified or they think that they don’t have a big enough down payment.” (emphasis added)

Many first-time homebuyers who believe that they need a large down payment may be holding themselves back from their dream home. As we reported last week, in many areas of the country, a first-time home buyer can save for a 3% down payment in less than two years. You may have already saved enough!

Bottom Line

Don’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Have a professional help you determine if you are eligible to get a mortgage.

Elk Grove, CA – Help our hometown earn new bragging rights and save energy by registering to participate in the CoolCalifornia Challenge.

Elk Grove could be California’s coolest city this year. It is one of 22 cities participating in the 2015-16 CoolCalifornia Challenge, a city-to-city competition encouraging residents and communities to work together to achieve California’s energy reduction and climate change goals. Other participating cities includeClaremont, San Mateo, Buellton, Indio, Burlingame, Long Beach, San Carlos, Lynwood, Martinez, South Pasadena, Redwood City, Huntington Beach, San Pablo, Benicia, Corte Madera, Mill Valley, Sausalito, El Cerrito, Fairfax, Larkspur, and Richmond. The CoolCalifornia Challenge runs through March 30, 2016.

The Challenge, organized by Energy Upgrade California, engages households in participating cities throughout the state to reduce their energy and water use at home as well as reduce their transportation emissions.

Help Elk Grove earn the title of “Coolest California City” and a portion of the $150,000 in prize money to support local sustainability efforts. You can join the Challenge by following these 3 simple steps:

Log your energy use each month during the Challenge (electricity, natural gas, vehicle gasoline) and share energy, transportation and water conservation efforts and activities to gain points for our city.

The city with the highest number of total points by March 30, 2016 will be crowned the winner. Participants can earn points, tracked through online software, if their home or vehicle energy use is below the baseline average in their city. Extra points are earned by participants that re-set their “personal best” for home energy and vehicle fuel consumption from a previous month. And bonus points are earned by signing up for the Challenge, filling out a MyEnergyUpgrade plan, uploading a photo, inviting friends to join the Challenge, sharing energy and water saving tips on social media pages, and committing to do an energy and water saving action and writing a review of that action.

It’s that time of year again…when the ghosts and goblins come out of hiding and everyone is sipping on their pumpkin spiced lattes. October is my favorite month and our family absolutely loves this time of year- the chill in the air, the leaves changing color, the caramel apples and the pumpkins galore! Visiting new pumpkin patches and checking out the scarecrows, decorations, hay stacks, mazes and gourds is always a treat. If you are searching for a place to take the kids for some fall fun, check out this list of local pumpkin patches and try to hit up one or a couple of them for some cheap family entertainment.